Lesson Learned – A Lesson Learned

Lesson Learned – A Lesson Learned

Perhaps it was the Super Bowl reminder that caused Joel’s glance to shift to the little blue envelope… for it was then that he noticed the line printed discretely on the envelope just to the left of his name:

“SUPER BOWL WINNER: 100% GUARANTEED. $1″

Now intrigued, Joel ripped open the envelope. Inside he found only a very short letter, which, in its entirety, read as follows:

Dear Sir:

The winner of next month’s Super Bowl game is known to me. For the sum of one American dollar in cash, I will reveal the name to you. If the team I name does not win, your dollar will be returned within 72 hours and you will never hear from me again.
—Balthazar Balash

Well, as you can imagine, Joel was hooked. “What’s this guy’s gimmick,” he wondered. “He can’t be making any money at a dollar a clip.” Joel extracted his wallet, removed a wrinkled one-dollar bill, inserted in the reply envelope and tossed it in the outgoing mail basket.

Shortly after New Year’s, another little blue envelope arrived at the Adler household. The letter inside read as follows:

(continued inside)

= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =

Inside the envelope was a 12-page letter with no letterhead. The copy was set in Courier (typewriter) type. Here is much of that letter:

= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =

(continued from the envelope)

Dear Sir:

The winner of the Super Bowl game will be the San Francisco 49ers.
—Balthazar Balash

Of course Joel didn’t believe a word of it. But the office betting pool was a small one. And even when he pocketed his winnings, following San Francisco’s dramatic upset victory, he hardly thought about the little blue envelope.

A few weeks later, the next blue envelope arrived.

Dear Sir:

The winner of next month’s election for Prime Minister of France is known to me. For the sum of five American dollars in cash, I will reveal the name to you. If the candidate I name does not win, your five dollars will be returned within 72 hours and you will never hear from me again.

—Balthazar Balash

Joel had little interest in French politics, but he was sufficiently intrigued to risk five dollars to see what would happen.

What happened was what the newspapers called “Stunning Upset in French Vote.”

“Boy,” thought Joel to himself, “I could have made a bundle betting on that one. Wonder what’s next.”

Next came a blue envelope guaranteeing the winner of a basketball playoff game — for $10. Joel made a few side bets at the office, and then made a pleasant profit when the prediction came true.

After the fourth prediction — for $25 — the surprise winner of a big mayor’s election — Joel was baffled, confused, and even more intrigued. He felt the need to talk things over with his old friend Jay McGraw.

“Jay, as a commodity broker, you’re in the prediction business yourself. What do you make of all this? “

The broker puffed on his pipe thoughtfully. “Look, Joel, you know as well as I that no one can see into the future. It’s just a gimmick of some kind.”

“Maybe so,” Joel replied, “But you’ve got to admit that four upsets in a row is pretty darn good.”

“Or pretty lucky. I’d like to see this Balash character try to predict something in my racket.”

“Then take a look at this,” said Joel, tossing a blue envelope onto the broker’s desk.

“Fascinating,” said Jay. “For a mere fifty bucks, he will tell you whether the price of gold will be higher or lower on June first than on May first. Are you inclined to take the risk?”

“Well, uh, I already have. Here’s his answer.” The familiar blue sheet had only one word on it: “Higher.” Joel smiled sheepishly. “I, uh, thought I might sell that mutual fund on May first and, well, buy some gold.”

The June 1 closing fix on gold in London was $22.50 higher than the May 1 close.

And the next four predictions, which cost the new partnership of Adler and Sampson $100, $250, $500, and $1,000 respectively, were equally surprising and equally correct. The two men, who had made quite a bit of money in investments and side bets, were utterly mystified.

“Look,” said Jay at one of their weekly lunches that fall, “I know I said I didn’t believe in magic. “But, well look — this Balash has made nine correct predictions in a row, and at least seven of them were big surprises. The odds against that are astronomical.”

Joel readily agreed. “Unexplainable things do happen all the time. I don’t know if it’s what they call a miracle or what. I just know that I’m darn well convinced.”

“I’ve got to admit that I am too,” said the broker. “In fact, I can hardly wait for prediction number ten.”

“Then have a look at this,” said Joel. “It came in the morning mail.” The blue sheet read as follows:

Dear Sir:

On September 27, there is a fight for the WBC heavyweight championship of the world. The winner is known to me. I will sell you that name for the sum of one million American dollars in cash. If the fighter I name does not win, I will refund your one million dollars within 72 hours.

Balthazar Balash

The two men looked at each other long and hard. Then, as one, they whipped out their pens and started calculating. “If I re-mortgage the house… ” “I’ve had an offer on that land in Hawaii.” “I can put together a syndicate —- I know Gustafson and Whitman would go for it…”

And so it went. Within a week, the syndicate had been formed. One million dollars to buy the name of the winner, and four million more to place the bets discreetly at Las Vegas and London bookmaking parlors.

The huge sum of cash was transmitted, and two weeks before the fight, the blue envelope came. The syndicate gathered in Jay’s office to open it. Joel was the first to speak. “It’s Walker ,” he shouted. “Walker —- the four-to-one underdog. That means sixteen million dollars, gentlemen. Sixteen million dollars!”

Based on records found in the apartment abandoned by Balash the day after two parcels containing $1 million cash each were sent to his Post Office box, the method used was as follows:

Initially, Balash sent out enough sales letters to produce at least 1,024 responses. Half of these customers (512) got a letter predicting that San Francisco would win the Super bowl. The other 512 got a letter predicting that Cincinnati would win. When San Francisco won, he used the money sent in by the 512 winners to make refunds to the 512 losers.

Next, for the French election, he sent one candidate’s name to 256 of his remaining customers and the other name to the other 256. Again, he paid off the losers with the money sent by the winners.

Now he had only 256 customers left. 128 got the name of one basketball team, 128, the other. For the mayor’s election, 64 people were sent each name. For the gold prediction, 32 people were told “higher” and 32 were told “lower.”

And so it went, right down the very last prediction, when he had only two customers left. Each of these customers had been given, by the luck of the draw, nine correct predictions. They were well and truly hooked. Of course they didn’t know that there had originally been 1,022 other clients.

One customer (an Arab oil sheikh) was given one fighter’s name for a million dollars, and the Adler syndicate was given the other fighter’s name for another million. The Arab presumably is quite happy now, and so, we may assume, is Balthazar Balash, who disappeared with two million dollars in cash, and can almost certainly never be traced.

Conclusion: In the business of predicting the future, some people may be quite good indeed —- but there’s no such thing as a 100% guarantee.

Anyone investing in the advice of predictors is hereby advised to act cautiously.